A new study has just been published that provides evidence that cause marketing results in lower charitable giving and lower happiness. Lucy Bernholz has long discussed the problems with “embedded giving” – consumer transactions which conflate purchases and charity in various ways – but this is the first study I’ve seen to demonstrate the danger.
The study, by Aradhna Krishna, a marketing professor at the University of Michigan, shows that people give less to charity subsequent to buying cause marketing products. The study notes that some cause marketing products cost more than a traditional product and so the purchaser is incurring a financial cost that they may feel offsets charitable giving. However, the study goes on to show that even costless cause marketing product purchases result in lower charitable giving.
In addition, the paper shows that making cause marketing purchases reduces happiness. Charitable giving makes people happy, especially altruistic giving (as opposed to egoistic giving, in which the donor is primarily seeking benefit for themselves). The purchase of cause marketing goods is a type of egoistic “giving”, which replaces more altruistic giving as well as reducing total giving.
However, while the potential danger of the cause marketing concept is demonstrated well and the gut instinct of people like Lucy Bernholz and other anti-embedded giving advocates is shown to be valid, the study is far from conclusive. As the author readily points out, the results are drawn from a pilot field study and two laboratory studies that were very small in scale. Additional research is certainly needed.
The author also suggests some interesting ideas for follow up studies such as: What would result in greater happiness: giving to a charity related to a personal cause or being more selfless and giving to a charity unrelated to a personal cause? Buying a product one likes or doing a selfless act by purchasing a less preferred product because it is cause marking related? To what extent do other various forms of giving effect subsequent giving?
My big take away from the study is that it demonstrates well the idea that celebrating all efforts at doing good can be dangerous and it is important that we focus more on results rather than efforts.